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THE MINISTRY OF TRADE

CIRCULAR No.1-TM/XNK OF JANUARY 24, 1997 GUIDING THE IMPLEMENTATION OF DECISION No.28-TTg OF JANUARY 13, 1997 OF THE PRIME MINISTER ON THE 1997 COMMODITIES AND IMPORT-EXPORT MANAGEMENT POLICY

On January 13, 1997 the Prime Minister issued Decision No. 28-TTg on the 1997 commodities and import-export management policy.

Pursuant to Decree No. 89-CP of December 15, 1995 of the Government on the abolition of the procedure for granting import, export permits; the inter-ministerial Circulars of the Ministry of Trade and the General Department of Customs guiding the implementation of Decree No. 89-CP and other legal documents;

On the basis of the results of the management of import-export activities in 1996;

The Ministry of Trade provides the following guidance for the implementation of Decision No.28-TTg of January 13, 1997 of the Prime Minister:

1. ON THE MANAGEMENT OF IMPORTS AND EXPORTS

The list of commodities banned from import and export, the list of commodities regulated by quotas, the list of commodities for import or export under specialized management regulations, the list of commodities related to the major balances of the national economy and the import export management in 1997 shall comply with the provisions of Article 1 to Article 8 of Decision No. 28-TTg and the Appendice enclosed therewith.

The following is additional specific guidance for a number of points:

1. Import of fertilizers

Pending a regulation on the import of and trading in fertilizers, pursuant to Point 2, Article 3 of Decision No. 28-TTg, the Ministry of Trade shall temporarily determine a list of enterprises eligible for importing fertilizers and assign import quotas to them (see Appendix No. 01).

2. Import of components for the assembly of automobiles and motorcycles:

The import of components for the assembly of automobiles and motorcycles shall comply with Point 3, Article 6 of Decision No. 28-TTg. The import of motorcycle components in IKD form must ensure that the provisions on the criteria for the assembly of motorcycle components in this form and on the quality of the components are complied with, the import of such components shall be approved by the Ministry of Trade on the basis of the dossier submitted by the enterprises, which includes:

- The economic-technical feasibility study

- The document of the General Department of Standardization, Measurement and Quality Control (the Ministry of Science, Technology and Environment) or of the agency authorized by the General Department certifying that the enterprise is fully qualified for the assembly of motorized vehicles in IKD form.

- The certification by the General Department of Standardization, Measurement and Quality Control or of the agency authorized by the General Department of the conformity of domestically manufactured components with the prescribed IKD criteria issued by the General Department of Standardization, Measurement and Quality Control.

3. Point a, Article 8 of Decision 28-TTg shall be implemented as follows:

In order to promote export, enterprises of all types (business or production), and all economic sectors, that have official import-export business permits, shall be entitled to conduct the export and act as agency to export commodities outside the commodity line stated in the permit, except the following commodities which are to be exported according to specific regulations:

- Rice.

- Textiles and garments exported to the EU, Canada, Norway and Turkey.

- Coffee.

- Wood products, forest products and processed forest products.

- Commodities exported under the specialized management mechanism.

This guidance shall replace Point 2.2.1 of inter-ministerial Circular No. 77-TTLB of July 29, 1996 of the Ministry of Trade and the General Department of Customs.

II. OTHER PROVISIONS

1. The provisions on the abolition of the procedures for granting import and export permits for each shipment shall comply with the provisions of Decree No. 89-CP of December 15, 1995 of the Government, inter-ministerial Circulars No. 01-TTLB of January 20, 1996, No. 07-TTLB of April 13, 1996 and No. 77-TTLB of July 29, 1996 and other relevant documents of the Ministry of Trade and the General Department of Customs.

2. In order to create favorable conditions for the enterprises to determine the commodity lines and items when they fill in the import-export procedure at the customs office, on the basis of the provisional explanation of the Ministry of Trade in inter-ministerial Circular No. 07-TTLB of April 13, 1996, the Ministry of Trade shall further interpret, supplement and concretize a number of terms and groups of words usually found in the import-export business permits of enterprises (see Appendix No. 02)

3. For such commodities as cement, clinker, sugar, steel, steel cast, construction glass, writing paper, book and newspaper printing paper and consumer goods which are mainly supplied by domestic production sources, the Ministry of Trade shall provide concrete guidance after the Ministry of Planning and Investment and other managing Ministries and branches have agreed on the regulations on additional imports. For the immediate future, in order to ensure uninterrupted business and production activities, the Ministry of Trade shall allow the enterprises to import these commodities according to the 1996 regulations.

4. Apart from the concrete guidance for the aforesaid commodities, the 1997 import-export management shall comply with the 1996 mechanism.

III. IMPLEMENTATION PROVISIONS

The Ministry of Trade asks the other Ministries, the ministerial-level agencies and agencies attached to the Government, the People�s Committees of the provinces and the cities directly under the Central Government and the central agencies of the mass organizations to popularize this Circular to the enterprises under their management so that they can implement it, and at the same time to bring to the Ministry of Trade�s knowledge the matters arising in the implementation process with a view to timely and appropriate adjustment.

This Circular takes effect from the date of its signing to March 31, 1998.

For the Minister of Trade

Vice Minister

NGUYEN XUAN QUANG

APPENDIX No. 1

PROVISIONAL LIST OF ENTERPRISES ALLOWED TO IMPORT FERTILIZERS IN 1997(*)

In the North:

1. The Vigecam Corporation

2. The Hachimex Trading Service Company of Haiphong City

3. The Ha Anh General Supplies Company of Hanoi City

4. The Nghe An Agricultural Supplies Company

5. The Minerals Import-Export Company under the Ministry of Trade

6. The Chemicals Corporation under the Ministry of Industry

7. The Haiphong Trading and Import-Export Service Company

In Central Vietnam:

8. The Quang Nam - Da nang Agricultural Supplies Company

9. The Daklac Inexim Company

10. The Phu Yen Arts and Import-Export Company (Corimex)

In the South:

11. The Grainco Company under the Ministry of Agriculture and Rural Development

12. The Ladfeco Company of Long An province

13. The Thasimex Company under the Ministry of Defense

14. The Epco Company of Ho Chi Minh City

15. The An Giang Food Company

16. The Southern Food Corporation under the Ministry of Agriculture and Rural Development

17. The Incomex Company under the Youth Union

18. The Dong Nai Agricultural Supplies Company

19. A Company to be recommended by the Committee for Ethnic Affairs and Mountainous Areas

20. The Petec Company under the Ministry of Trade

(*) This list is valid until a new Government decision is issued

APPENDIX No. 2

INTERPRETATION OF A NUMBER OF TERMS OFTEN FOUND IN THE IMPORT-EXPORT BUSINESS PERMITS OF ENTERPRISES

An import-export business permit issued by the Ministry of Trade to the enterprises is a State document certifying the range of commodities permitted to be traded with foreign countries. This permit is granted to an enterprise formerly established under Decree No. 388-CP of the Government, under the Law on State Enterprises (after this Law takes effect), under the Corporate Law and other guiding documents of the Government. The range of commodities shall be determined mainly according to the business registration licenses issued by the Economic Arbitration or the provincial/municipal State Planning Committee when the enterprise is established.

In order to create favorable conditions for enterprises to run their business and avoid unnecessary changes, the Ministry of Trade, when granting import-export business permits, have attempted to modify a number of terms to suit the practical situation while keeping the contents of business registration of enterprises unchanged.

In this context of granting import-export business permits, the phrases concerning imports and exports in a number of cases are understood differently by the managing agencies.

To avoid obstacles in the filling up of the import or export procedures, the business types and the range of commodities which the enterprises are permitted to import and export should be determined:

I. IMPORT-EXPORT BUSINESS PERMITS OF THE PRODUCTION TYPE:

These permits shall be granted to the units engaged in producing goods for export or processing subcontracted goods for foreign countries.

Under this type of permits:

a/ The exports shall be subject to Point 3 of Circular 01-TM/XNK of January 24, 1997.

b/ The imports under this type of permit shall include various kinds of machinery, equipment, spare parts, supplies, materials and auxiliary materials, etc. to cater only to the production of export commodities by the concerned enterprises and must not be used on the domestic market for business purposes.

II. IMPORT-EXPORT BUSINESS PERMITS OF THE SPECIALIZED BUSINESS TYPE

The enterprises having these permits may export goods according to Point 3 of Circular 01-TM/XNK of January 24, 1997 and import goods within the range of commodities stated in the permit. In a number of cases, they may be permitted by the Ministry of Trade to import other goods not stated in their permits.

The terms determining the range of imports stated in the import-export business permits shall be construed as follows:

1. Means of production, supplies, materials and auxiliary materials in service of production and temporarily classed into the following groups:

1.1 Fuel, minerals, technical lubricants and grease:

- Gas, petroleum of all kinds

- Lubricants and grease of all kinds

- Raw materials for the production of petroleum, lubricants and grease

- Coal of all kinds

1.2. In service of agriculture, forestry and fishery: Fertilizers of all kinds, pesticides, weed-killers, growth stimulants, veterinary medicines, breed animals, saplings, seeds, raw materials for the production of animal feeds, fishing gear, etc.

1.3. In service of the food and beverage industry: Wheat flour, seasonings, sugar, milk powder materials, butter oil, vegetable oil, shortening, foodstuff dyes, flavorings, fresh or processed meat and fish, fresh and dried spices, malt, hublon, cans and bottles, etc.

1.4. In service of the manufacture of cigarettes: Tobacco leaves, tobacco , rolling paper, materials for making cigarette packs, flavorings, filters or raw materials for filter making, etc.

1.5. Chemicals and pharmaceuticals: Chemicals of all kinds, dyes, raw materials for production of paints, varnishes, printing ink and packings of all kinds, DOP oil, raw materials for production of medicines for man or animals, coloring matters, rubber vulcanizing substances, cleansing substances, refined oil of all kinds, raw materials and flavorings for production of cosmetics, etc.

1.6. In service of production of light industry goods: Fabric of all kinds, sheep wool, wool, cotton tow, chemical yarn tow, cotton fiber, chemical fiber, stable fiber, leather of all kinds, leatherette, textile and garment auxiliary materials, raw materials and auxiliary materials for production of paper and plastics, etc.

1.7. Electric, electronic and optical materials: Light bulbs of all kinds, electric cables, conductive wires of all kinds, circuit breakers, automatic safety fuse of all kinds, electricity distribution panels, components, raw materials and auxiliary materials for assembly of electro-mechanical, electric, electronic, optical items, etc.

1.8. Supplies in service of the educational and cultural services, printing industry, cinematography, photo making facilities, tapes, CD, sport and gymnastic gear, musical instruments, children�s toys.

1.9. Metal products: pig-iron, iron, copper, aluminum, lead, zinc and other non-ferrous metals or alloys in the forms of finished products or cast. Steel and iron of various kinds in the forms of finished products or cast, etc.

1.10. Explosive materials and explosives

1.11. Wood of all kinds, paper of all kinds

1.12. Construction materials: including cement of all kinds, construction steel and iron of all kinds, clinker and additives for the production of cement, bricks, ornamental tiles, paints, glass, oil paper, metal and aluminum frames, semi-processed structures, bathroom fixtures (bath tubes, lavatories...), bitumen, asphalt, insulation glass...

2. Machinery, equipment, spare parts in service of production:

+ Machines tool of all kinds and spare parts.

+ Machines and spare parts used in agriculture, fishery and water conservancy.

+ Production-supported machines such as power generators, electric motors, welding machines, transformers, plating machines, painting machines, etc.

+ Machines and spare parts in service of light industries: textile, apparel, shoe leather, ceramics and pottery, paper, glass, food processing and the production of consumer goods.

+ Machines and equipment for the ship building or repairing industry.

+ Machines for producing packings from metal, paper, plastics, glass, etc.

+ Telecommunications, radio transmitting, radio and television broadcasting, telephone, telegraphic, telex and fax equipment.

+ Machines and equipment for the production of films and photos: cameras, film projectors, photo developing and processing machines, video recorders...

+ Printing equipment, office equipment.

+ Laboratory equipment of all kinds.

+ Equipment for exploiting and processing minerals (coal, crude oil, ore of all kinds...).

+ Medical and pharmaceutical machines and equipment.

+ Machines in service of the construction of roads and bridges such as jacks of all kinds, concrete making and mixing machines, mechanical capstans and cranes...

+ Construction machinery (bulldozers, excavators, shovellers, road rollers, etc.) and machines for producing construction materials (cement, bricks and tiles, concrete mixing, clinker crushing, stone crushing and processing...).

+ Power generating machines and equipment (hydropower, thermo-power, transformer stations, electricity distribution stations).

+ Machines and equipment in service of the railway and shipping services (lighthouses, signal buoys), and aviation (airport facilities, radar, air traffic control equipment).

+ Seaport and river port facilities.

+ Machines and equipment for the metallurgical industry.

+ Machines and equipment for the forestry, wood processing and wood furniture production industry.

+ Equipment for animal husbandry (incubators, machines for checking and sorting eggs, milking machines, etc.).

+ Technological chains and complete equipment for industries.

+ Machinery and equipment in service of security and defense.

+ Machines and equipment of other kinds.

+ Spare parts for the aforesaid machinery and equipment.

+ Tubes and tires for vehicles of all kinds.

3. Means of transport:

The enterprises may import means of cargo and passenger transport by air, road and water (automobile of kinds, trailers, motorcycles, motor tricycles, ships, motor boats, ferry boats, aircraft, carriages, locomotives...) and spare parts.

4. Consumer goods:

Following is the list of consumer goods and their codes:

4.1. Food:

+ Milk and milk products: including products under Headings from No. 0401 to No. 0406 in Chapter 4 (Chapter on Milks and milk products; bird eggs and poultry eggs...).

+ Confectioneries:

- The commodities in Chapter 17 (sugared jams and candies of all kinds).

- The commodities under Heading No.1806 in Chapter 18 (cocoa and cocoa products).

- The commodities of sub-Headings from No. 190510 to No.190540 in Chapter 19 (cereal, flour, refined flour and dairy products: cakes of all kinds).

+ Beverages:

- The commodities in Chapter 22 (beverages, alcohol, beer...) except those under Headings No. 2207, No. 220810 and No.220900.

- The commodities under Heading No.2009 in Chapter 20 (fruit juices, vegetable juices...).

- The products under Headings from No.090111 to No.090121 in Chapter 9 (roasted or unroasted coffee ) and tea of all kinds.

+ Fresh and dried fruits: the commodities in Chapter 8 (edible fruits, shells of citrus fruits and coconuts) except those under Heading No. 081400 (shells of fruits...).

+ Canned products of all kinds:

- Canned products in Chapter 20 (products made of vegetables, fruits, seeds and other parts of trees).

- The products under Headings No. 2103 and No. 2104 in Chapter 21 (other processed edible products), canned.

- The products in Chapter 2 (meat and offal of animals) and of Chapter 3 (fish and mollusks, crustaceans and other aquatic invertebrates), canned.

4.2. Household and personal goods:

+ Kitchenware:

- The products under Heading No.392410 in Chapter 39 (dining set, kitchen utensils).

- The products under Heading No. 4419 in Chapter 44 (dining set, kitchen utensils).

- The products under Headings No.7321 (stoves, fires, cookers, grills, roasting ovens ...), No.7323 in Chapter 73 (dining set, kitchen utensils, and other home appliances...).

- The products under Heading No.741810 in Chapter 74 (dining set, kitchen utensils or other home appliances).

- The products under Heading No.761510 in Chapter 76 (dining set, kitchen utensils...).

- The products under Heading No. 8215 in Chapter 82 (coffee spoons, forks, soup ladles...).

- The commodities under Heading No.691110 in Chapter 69 (dining set and kitchen utensils).

- The commodities under Heading No.7013 in Chapter 70 (dining set, kitchen utensils...).

+ Interior decoration:

- The commodities under Headings No.9403 and 9404 in Chapter 94 (beds, wardrobes, tables and chairs and parts thereof, bed cushions, articles of bedding or similar furnishing).

- The commodities under Heading No.9105 in Chapter 91 (alarm clocks, wall clocks).

- The commodities under Headings No.6301, 6302 and 6303 in Chapter 63 (rugs and traveling blankets; bed linen, table cloth, curtains, blinds and thin laces).

+ Ready-made clothes, uniforms of all kinds:

- The commodities of Chapter 61 (ready-made garments and clothing, knitted, crocheted), except those under Heading No. 611220 (ski suits).

- The commodities of Chapter 62 (ready-made garments, not knitted or crocheted) except those under Heading No. 621120 (ski suits).

- The commodities of Chapter 64 (shoes, sandals, gaiters and similar products), except those under Heading No. 640311 (snow-boots and ski boots).

- The commodities under Headings No. 6503 to No. 6506 (hats, headdress of all kinds).

- The commodities under Heading No. 6601 (umbrellas of all kinds) in Chapter 66.

+ Cosmetics:

- The commodities under Headings No. 3303 to No. 3307 (perfumes, scents, cosmetics or make-ups; hairdressing products, goods for oral or dental hygiene; products used before or after shave, personal deodorants...).

4.3 Electric, electronic and optical products in complete sets:

+ Electric products:

- Electric home appliances (irons, electric kettles, shavers, vacuum cleaners, fruit juicers, washing machines).

- Home fans of various kinds.

- Home electrical incandescent lamps and electrical discharge lamps of all kinds.

- Home air conditioners.

- Home refrigerators.

+ Electronic commodities:

- Televisions, radios, radio cassettes, video recorders, cassette decks, tape recorders.

+ Optical products:

- Cameras, video cameras, video recorders, eyeglasses.

4.4. Means of transport:

- Automobiles with less than 12 seats.

- Motorcycles with a piston capacity of less than 175 cm3.

Bicycles.-